Question
Pharoah Company sponsors a defined benefit pension plan for its employees. The following data relate to the operation of the plan for the year 2020
Pharoah Company sponsors a defined benefit pension plan for its employees. The following data relate to the operation of the plan for the year 2020 in which no benefits were paid.
1. | The actuarial present value of future benefits earned by employees for services rendered in 2020 amounted to $55,800. | |
2. | The companys funding policy requires a contribution to the pension trustee amounting to $136,000 for 2020. | |
3. | As of January 1, 2020, the company had a projected benefit obligation of $902,500, an accumulated benefit obligation of $797,300, and a debit balance of $401,800 in accumulated OCI (PSC). The fair value of pension plan assets amounted to $595,300 at the beginning of the year. The actual and expected return on plan assets was $53,700. The settlement rate was 8%. No gains or losses occurred in 2020 and no benefits were paid. | |
4. | Amortization of prior service cost was $50,000 in 2020. Amortization of net gain or loss was not required in 2020. |
(a)
Determine the amounts of the components of pension expense that should be recognized by the company in 2020. (Enter amounts that reduce pension expense with either a negative sign preceding the number e.g. -45 or parenthesis e.g. (45).)
Components of Pension Expense |
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Name Component expense - $
Name Component expense - $
Name Component expense - $
Name Component expense - $
Name Component expense - $(Total)
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